Entrepreneurship indicators of Canadian enterprises, 2020
In 2020, there were 1,179,960 active enterprises in Canada with one or more employees, and two-thirds had four employees or fewer. There were 90,010 births of enterprises in 2020 and 97,880 deaths in 2019.
These indicators are part of the Entrepreneurship Indicator Database program, which is now available upon request for the 2020 reference period. The Entrepreneurship Indicator Database program provides data that describe the entrepreneurial dynamics of Canadian enterprises.
Indicators include the number of active enterprises, the number of enterprise births and deaths and their corresponding jobs, the survival of newly created enterprises, and the number of high-growth enterprises and gazelles. The active enterprises include all enterprises with at least one employee.
In 2020, Canada had 5,040 high-growth enterprises by employment and 10,700 high-growth enterprises by revenue. Enterprises in the construction sector represented the largest number of high-growth enterprises by employment (15.5%) and by revenue (18.2%).
Small enterprises bore the brunt of enterprise deaths in 2019
Small enterprises, defined in this report as enterprises with one to four employees, bore the brunt of enterprise deaths in 2019.
Of all enterprises that died in 2019, more than 8 in 10 (83.3%) were small enterprises. Most of the deaths were in the professional, scientific and technical sector, which accounted for 16.5% of all deaths.
Small enterprises, however, were also the driving force behind enterprise births. Of the 90,010 new enterprises that were created in 2020, 85.7% were small firms with one to four employees.
The professional, scientific and technical services sector also had the most enterprise births, representing 18.0% of all births of active enterprises in 2020.
Over 8 in 10 enterprises created in 2019 survived during their first year
Among new enterprises with at least one employee in 2019, the survival rate in 2020 was 84.0%. Among those that were born in 2018, 71.2% were still active in 2020.
The proportion of high-growth enterprises was higher in the information and cultural sector
The database also allows for the identification of "high-growth" businesses, and "gazelles" among enterprises with at least 10 employees, either by employment or by revenue.
High growth enterprises are defined as those that reported more than 20% in employment or in revenues over the past three years on average. Gazelles are high-growth enterprises that are 5 years old or less.
In 2020, high-growth enterprises from the point of view of employment growth accounted for 2.6% (5,040 enterprises) of all enterprises with at least 10 employees, while gazelles accounted for 0.5% (920 enterprises).
The information and cultural industries sector had the highest percentage of high-growth enterprises (6.0%), followed by the professional, scientific and technical services sector (5.2%) and administrative and support, waste management and remediation services (4.4%).
When things are examined from a revenue perspective, however, high-growth enterprises by revenue represented 5.5% of all active enterprises with at least 10 employees, while gazelles represented 0.9%.
The information and cultural industries sector had the largest percentage of high-growth enterprise by revenue (11.2%), followed by the finance and insurance sector (9.7%) and the construction sector (9.3%).
Note to readers
Entrepreneurship indicators are produced nationally, by province and territory, industry and enterprise size.
The Entrepreneurship Indicator Database contains an up to date and unduplicated count of enterprises in Canada, based on the Statistics Canada's Business Register and on concepts and definitions from the Organization for Economic Co-operation and Development.
Because year-over-year variations in entrepreneurship indicators or employee counts may represent changes in methodology in the source data rather than economic changes, comparisons with previous releases should be made with caution.
The tables are available upon request.
Employer enterprise birth is a new enterprise that has at least one employee in the birth year or an enterprise that was present before the year in consideration, but below the threshold of one employee. Reactivations are excluded from the population of employer enterprise births. Births do not include entries into the population due to mergers, break-ups, split-off or restructuring of a set of enterprises.
Employer enterprise death is an enterprise death with at least one employee in the year of the death that stops being present or an enterprise that moves below the threshold of one employee for at least two years. Deaths do not include exits from the population due to mergers, takeovers, break-ups or restructuring and enterprises that reactivate in the next two years are excluded from the population of enterprise deaths.
High-growth enterprises, by employment (or revenue), are enterprises with an average annual growth in the number of employees (or revenue) greater than 20% over a three-year period that have at least 10 employees at the beginning of the observation period.
Gazelles represent the youngest of high-growth enterprises (i.e., are up to 5 years old).
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